Move aside, U.S. baby boomers. The Millennial generation is bigger than you and growing in influence. (See Exhibit 1.) Now numbering 79 million (compared with the boomers’ 76 million), U.S. Millennials—people between the ages of 16 and 34—have been the subject of abundant analysis and commentary, mostly revolving around their avid use of technology, changing media-consumption habits, and entry into the workforce. Less has been written about Millennials as consumers. How do they interact with brands? Where do they eat and shop? How do they make buying decisions, and what factors influence their opinions and choices? Is it true that Millennials consume less than previous generations? On average, U.S. Millennials already shell out and influence the expenditure of hundreds of billions of dollars annually—an amount that will only increase as they mature into their peak earning and spending years.

Millennials’ expectations are different from those of previous generations, and companies will need to rethink their brands, business models, and marketing accordingly. Yet our research shows that many executives who make product and service decisions for their companies have negative or dismissive attitudes toward Millennials. Clearly, companies will have to understand, accept, and embrace the characteristics and values of this generation if they are to create and market relevant products and services that resonate with them and meet their needs.

Although the youngest members of the Millennial generation are still economically dependent on Mom and Dad, older Millennials are beginning to enter their peak spending years. While they are not yet set in their ways, they are forming preferences, exhibiting tendencies, and influencing one another’s opinions and behaviors. This generation engages with brands, channels, and service models in new ways limited only by the rate of technological advancement and innovation.

To better understand this generation, The Boston Consulting Group, along with Barkley and Service Management Group, surveyed 4,000 Millennials (ages 16 to 34) and 1,000 non-Millennials (ages 35 to 74) in the United States. A key goal of this research was to identify how behaviors and attitudes differ between the two groups and determine which of those differences are truly generational characteristics of Millennials—and not merely qualities associated with youth in general. We extended the broadly accepted definition of “Millennial” a few years beyond the upper end of the age range in order to capture the pivotal years during which Millennials transition to the next stage of life. This allowed us to gain greater insights into which of their attitudes and behaviors might change later in life and how.

The first of two reports, this overview of Millennial consumers explores who they are today and what they think of themselves and the world around them. We’ll also examine the six different segments of U.S. Millennials that our research revealed. In our second report, we’ll delve deeper into the industry sectors and categories that the survey addressed, such as how the members of this generation shop for apparel and groceries, where they eat out, how they travel, and their favorite brands relative to non-Millennials.